Union Election Ordered for Northwestern University Football Team: NLRB Rules Scholarship Athletes Are Not 'Primarily Students,' They Are 'Employees'

In an unexpected and controversial move, the Regional Director of the National Labor Relations Board in Chicago ruled late yesterday afternoon that the scholarship football players at Northwestern University are “employees” of the University under the National Labor Relations Act. As a result, unless the decision is overturned on appeal, the players will soon vote on whether they want to be represented by a union. (The Decision is posted on the NLRB webpage and can be found here.)

Scholarship Athletes Are Not Primarily Students

The Board’s decision to allow a union vote among the Northwestern scholarship football players focuses almost exclusively on the common law definition of who is considered an “employee.” That definition provides that if two conditions are met, a person is considered an “employee.” First, a person must perform services for an entity in return for payment. Second, that person must also be subject to the control of the entity for which the services are performed. According to its interpretation of the evidence, the Board boldly concluded “…it cannot be said the [University’s] scholarship players are ‘primarily students;’” instead, they were found to be “employees.”

A Scholarship is Compensation In Exchange for Performance

The Board held that scholarship football players (note: walk-on players were found to not be University “employees”) receive compensation or “payment” in the form of “grants-in-aid” (commonly referred to as athletic scholarships). According to the decision, although a scholarship may not look like a “traditional paycheck,” it is nevertheless compensation in exchange for performing on the playing field. For example, if the athlete quits the team or breaks certain rules, he risks losing the scholarship. Thus, the scholarship is “clearly tied to the player’s performance of athletic services…” and is therefore, according to the Board, compensation in exchange for services rendered.

The Board went into great detail to describe how significant the “paycheck” was for Northwestern’s scholarship athletes. In defining the relationship between scholarship players and the University as primarily an employment relationship, the Board stated:

[the evidence] is insufficient to show that their relationship with the [University] is primarily an academic one. Indeed,…this relationship is an economic one that involves the transfer of great sums of money to the players in the form of scholarships. The [University] expends between $61,000 and $76,000 per scholarship per year or in other words over five million dollars per year for the 85 scholarships.

The point seemed to be that the amounts received by players were not of a minor consequence from a “compensation” standpoint. Instead, the Board held these players are provided “great sums” in the form of scholarships, but only if they perform the necessary “athletic services.”

Scholarship Athletes Are Under the University's Strict Control

The Board had little trouble finding evidence that scholarship football players are under direct and significant control in the performance of their “athletic services.” Beyond the normal direction received by players on the field by way of coaching, the Board was persuaded by the fact that athletes are engaged in athletic pursuits 50-60 hours per week and are required to follow strict rules and policies that no other University student is required to follow. The players are subject to rules about how they spend their time every day (including detailed agendas from 5:45 a.m. to 10:30 p.m.), where they live, whether they can engage in outside work, and even the vehicles they drive. Northwestern football players are even required to accept their coaches’ “friend” requests on Facebook.

In addition to the formalized control contained in policies and rules, the Board was also persuaded by evidence that football players were encouraged to modify their class schedules so as not to interfere with their “athletic services.” Scholarship athletes were directed to make practice time and other required athletic activity a priority. One player testified that he changed his major from pre-med to psychology because he felt pressured not to take required pre-med classes that conflicted with practice times.

Considering all the common law employment factors, the Board concluded, “As the record demonstrates, players receiving scholarships to perform football-related services for the Employer under a contract for hire in return or compensation are subject to the Employer’s control and are therefore employees within the meaning of the Act.”

What’s Next For Northwestern?

The decision issued by the Regional Director of the NLRB in Chicago is subject to appeal. If Northwestern does not appeal, an election among the players about whether they want a union will likely occur soon. However, Northwestern stated in a press release, issued late last evening, that it intends to appeal the decision. If so, it must file the appeal with the National Labor Relations Board in Washington, D.C. by April 9, 2014. At that point, the Board may delay the election. If Northwestern loses an appeal to the NLRB in Washington D.C., it will likely have to allow the union election to go forward and, if the players elect to be represented by a union, Northwestern will likely have to "refuse to bargain" to have any further legal challenges heard by a federal appellate court, and eventually the U.S. Supreme Court. Obviously, we are only in the "first quarter" of this game.

What Could This Decision Mean?

There are many issues raised by this decision, not just for Northwestern University, but for every private, and perhaps public, university with scholarship athletes of any kind. Here’s a short list of potential issues:

Does every scholarship athlete at every private institution, all of whom may now be considered “employees,” have rights under the National Labor Relations Act? To take an extreme example, what if Stanford basketball star Chasson Randle tells his coach, Johnny Dawkins, that he and his teammates have decided not to run wind sprints in preparation for their game against Dayton tonight? Would that be “protected concerted activity” which is protected against any "adverse action" by Coach Dawkins? If you think this is far-fetched, remember the Grambling football players' "strike" last season.

Will scholarship athletes at public institutions press for the same rights as their peers at private institutions and, if they do, how will the institution handle the decisional and PR aspects of that issue?

How will public institutions (which are generally not subject to the National Labor Relations Act) manage relationships with unionized private institutions?

How will conferences and the NCAA change their relationships, rules, and policies to deal with institutions who must now “bargain” with athletes’ unions over “wages, hours, and other terms and conditions of employment”?

How will the rights afforded to unionized players under the National Labor Relations Act impact a university’s obligations under Title IX? Are these athletes “employees” for purposes of the National Labor Relations Act, but still “students” for purposes of Title IX?

What documentation will coaches have to generate to defend against a claim that benching a team member, disciplining a player, or removing an athlete from the team was not in retaliation against the team member's union or other protected activities?

If walk-on players are not "members of the bargaining unit," how can a team maintain consistency and order when there is one set of "terms and conditions" covering the 85 scholarship players, and another set of "terms and conditions" covering 25 or more walk-ons?

How far into Pandora's Box of employment law will the NLRB's decision go? If scholarship athletes are considered "employees" under the National Labor Relations Act, will they be considered employees for purposes of other federal and state laws?

Conclusion

At this early stage of the controversy, the best advice we can provide to colleges and universities is to become fully aware of the current and potential issues, as well as closely review their relationship with their student-athletes, including whether their "workplace" is one where a majority may feel the need to pay for the sort of outside protection from abusive supervision a labor union claims to provide. It may be prudent to revise policies, agreements or standards. Administrators within the athletic department should receive training on players' rights under the National Labor Relations Act. They need to be armed with knowledge and discuss these issues freely so that costly mistakes can be avoided. Please contact us if you would like assistance in developing a "playbook" to help protect your institution.

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader's specific circumstances.